Paid web news = Fail! I offer a softer alternative

By Steve Outing

My May Editor & Publisher Online column was published today — “Getting Money from Readers Who Won’t Pay for Online News” — and it’s mostly getting positive reviews so far. I make the case against daily newspapers’ shift toward charging for local news on their websites, and suggest an alternative: paid memberships that work with the paper’s advertisers and offer significant value, so it’s not just a “tin cup,” “please support local journalism” strategy.

As I note in the column, this is one option being considered by the New York Times. Also, today I heard from a couple other newspaper folks who say they’re either discussing or working on such a membership program.

Over on the Media Nation blog, Dan Kennedy mentioned my column, and one of his commenters suggested:

“Outing’s assessment No. 3 needs a touch of adjustment. The REAL monetary value of a newspaper is in its subscriber/readership base, and the access to that base that it can provide. This is what advertisers pay for. Content is the benefit that the subscriber/reader gets for allowing the publisher into their lives. …

“Those who cut content risk the alienation of the very constituency that enables them to charge the advertising rates on which their very survival depends.”

That brings up a point I missed in the column: A high-value membership program could attract paying members who don’t use the core product (newspaper and/or website). Here’s my response to the commenter:

“Hmmm. What I advocated in my column (the part you refer to as No. 3) is that a ‘membership program’ become a new addition to a newspaper company’s ad program that would be appealing to advertisers and enticing enough that consumers would clamor to pay for the benefits in great enough numbers that they support the newspaper’s reporting. It’s similar to commercials supporting ABC World News Tonight, or ads supporting the free alternative weekly in your town, but the newspaper membership doesn’t require you to read the paper’s website content.

“You make a good point. Perhaps the editorial content shouldn’t be completely detached from the revenue source, so that people don’t just buy the membership because of all the great deals but then don’t read the news, which then hurts the newspaper website’s ad revenues. So yes, perhaps a ‘touch of adjustment’ is in order.

“I often like to flip things on their heads to get a different perspective. One possibility might be to have a base membership price (say $20/month), but offer discounts based on the member’s pageviews during the previous month. … Or let them take a news quiz at the end of each week and if they score above a set level, they get $5 off that month. … Sounds a bit crazy, but we’re not only interested in making money to support news gathering; we’re also interested in an informed public and a better functioning democracy.

“I’d most like to see newspaper publishers get more creative. ‘Let’s put up a pay wall’ demonstrates the lack of creativity and innovation at the highest levels of the industry.”

Author: Steve Outing Steve Outing is a Boulder, Colorado-based media futurist, digital-news innovator, consultant, journalist, and educator. ... Need assistance with media-company future strategy? Get in touch with Steve!

3 Responses to "Paid web news = Fail! I offer a softer alternative"

  1. Brad King
    Brad King 8 years ago .Reply

    The value comes in the community and providing tools to them. The sooner newspapers stop trying to “guess” what people will pay for and providing date-driven information that can answer questions that Google (and soon Wolfram Alpha can’t), there is a product and business behind it. But that requires a radical mining of data and overhauling of how data – > information -> stories are conceived, collected and displayed.

    Anything that touches the free, distributed model of stories will crush the growing online ad model.

    The extras need to come from a web-based perspective.

  2. Frymaster
    Frymaster 8 years ago .Reply

    For lack of commenting on E&P, I posted this commentary on a newspaper discussion board I moderate (in great solitude).

    My basic arguments (or critiques, if I might be so bold), are:

    1 – Advertising is the way. But only advertising that users want to _read_ (not view) and click.

    2 – Those well-informed, articulate commenters that you want to pay to be in your club – they don’t need newspapers to enter into discussion. They’re (we’re) already talking in the blogosphere. Put another way, the community-driven value you want to create on a newspaper website already exists to a large degree outside the newspaper.

    What’s missing from the newspapers’ thinking, IMO, is the basic Cluetrain, user-oriented perspective that has been proven over and over to be the winning formula. It is highly counter-intuitive, but highly profitable. Ol’ Jeff Jarvis has been pointing in the right direction and asking a very, very, very important question.

  3. Steve Outing
    Steve Outing 8 years ago .Reply

    Frymaster: On point No. 1, advertising, I agree. The “newspaper membership” model that I wrote about is more about replacing revenues that (ahem, dinosaur) newspaper execs seem to think they can get from charging for news on the web. And it actually adds to a newspaper’s advertising program with new and effective means to generate more ad revenue. The problem with newspapers and advertising is simple: In our crowded new media environment, there’s not enough ad money to go around and support everyone; certainly not enough to support big newsrooms of the past. Additional revenue streams are required. So a membership program and mobile discounts-from-advertisers strategy could bring in member revenue AND advertiser dollars that otherwise would be allocated elsewhere.

    On No. 2, I also agree. But, there may be niche topics within a community, where a beat reporter covers it well, that don’t have a strong online community. What a newspaper (in theory) can bring is experts and celebrities in the topic niche, who agree to mix it up with the select group of members willing to pay for a program that includes that extra privilege. Existing self-organized communities may not have that advantage.

    But the main reason I’m suggesting this bit of exclusivity to topic forums is that most newspaper open-comment areas are out of control and basically worthless unless you enjoy the bashing and lame jokes that populate them. A way to promote useful discussions is to create narrow niche forums that attract a topic’s enthusiasts and experts only, and set a (low) bar to contribute to keep the spammers and jokers out.

    I don’t suggest that charging to comment/express an opinion is a “killer” way to bring in money, but it’s one small thing you could add in a package of paid member benefits. And you might limit it to just some “premium” forums. The benefit to non-members who don’t pay is in reading the content in the exclusive forums, where the quality of the content should be high.

    Cluetrain: I’m with you.

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